International Trade Strengthens Emerging APEC Economies

International trade is a defining factor as economies address the global economic crisis.

"Since last year's APEC meeting, the global environment has deteriorated dramatically, and the financial crisis has spread to emerging economies," said International Monetary Fund (IMF) Deputy Managing Director, John Lipsky yesterday, in a statement at the 15th annual APEC Finance Ministers' Meeting. "While a modest recovery is expected to begin in the second half of 2009... growth in Asia is expected to slow along with the global economy, as exports weaken and spillovers from the global turmoil weigh on domestic demand."

While the situation affects both developed and emerging economies, some are better positioned to cope. This is not, however, to say that the most developed economies will be the ones to fare best. Indeed, Lipsky suggests that in the future, growth should be largely the domain of emerging economies, which are growing three times as fast as developed ones.

An excellent example can be found in Peru, the host of APEC's Finance Ministers' Meeting this week. He explains:

"The economy has opened up significantly to international trade and reforms are going to enhance the business environment, reduce informality and alleviate poverty... We [Lipsky and Peruvian President Garcia] have agreed that Peru is well placed to face the global financial crisis and sustain high economic growth... [Peru's] economic growth at present is the fastest in Latin America and one of the fastest among emerging market economies. Inflation has accelerated... but remains one of the lowest in the region."

It has been a fundamental tenet of APEC that increased trading opportunities lead naturally to markets that are more competitive, diversified and therefore better able to withstand crisis. As part of its social agenda, APEC has enabled those whose access would otherwise be limited to engage in the global marketplace - through training in information and technology and language; and by encouraging lending by financial institutions.

The APEC Financial Ministers Meeting will conclude with the issuing of a Joint Ministerial Statement by the 21 member economies. The Statement will be made available at: http://www.apec.org/Meeting-Papers/Ministerial-Statements/Finance/2008_finance.aspx?t=1

The APEC Leaders Summit (November 23-24) will also address the existing global financial crisis.